Israeli Prime Minister Benjamin Netanyahu warned on Sunday that Israel would act against Iran if needed, calling it the world's greatest threat.

Israel is seeking wider support to contain its regional foe as tensions increase in the Middle East over Iran's role in Syria and Yemen and as US President Donald Trump presses for an overhaul of Tehran's 2015 nuclear deal.

The rhetoric went up a notch when Netanyahu addressed the Munich Security Conference.

He accused Iran of trying to build an "empire" across the Middle East.

Holding a piece of what he said was an Iranian drone after its incursion into Israeli airspace earlier this month, Netanyahu said: "Israel will not allow the regime to put a noose of terror around our neck."

"We will act if necessary not just against Iran's proxies but against Iran itself," he said.

In his first address to the annual Munich event, which draws security and defence officials and diplomats from across Europe and the United States, Netanyahu urged his audience to counter Iran immediately, displaying a map showing what he said was Iran's growing presence in the Middle East.

Netanyahu also drew a parallel between Iran's 2015 nuclear deal and the 1938 Munich Agreement that failed to appease Nazi Germany.

Among Israel's main concerns is Lebanon, where the heavily armed Iran-backed Shi'ite militia Hezbollah is part of a coalition government. Israel last fought a war against Hezbollah in 2006.

He mocked Netanyahu's tough words, saying Israel's reputation for "invincibility" had crumbled after one of its jets was shot down following a bombing run in Syria.

During his speech, the foreign minister also reiterated Iran's proposal for a "regional dialogue", calling it the "only viable alternative out of the misery that we've been in".

But he warned Iran would respond if Washington gave up on the 2015 accord curbing its nuclear ambitions in return for sanctions relief.

"I can assure you that if Iran's interests are not secured, Iran will respond, will respond seriously and I believe it would be a response that means people would be sorry for taking the erroneous action they did. We will not be the first ones to violate an agreement for which all of us tried – in spite of (Israeli Prime Minister Benjamin) Netanyahu's attempts – to achieve," Zarif said.

"We achieved it in spite of him, we implemented in spite of him, and the world will maintain that agreement in spite of his delusional attempts."

On Saturday, during his visit to India, Iranian president Hassan Rouhani said his country would adhere to the terms of the 2015 nuclear deal till "the last breath" and warned that the US would "regret" if the pact was broken.

Former US Secretary of State John Kerry, who helped clinch the nuclear agreement, said it was "absolutely critical" that the world sticks to it.

President Donald Trump is deeply skeptical about the accord. He extended sanctions waivers last month but said he would not do so again when they come up for renewal in May unless his concerns are addressed.